While pipelines and rail are often the transportation modes that spring to mind for moving oil in the US, there’s also a market for inland barges. In this week’s Oilgram News column, Petrodollars, Joshua Mann assesses how the market to move oil has shifted under pressure from crude prices. The inland US crude-by-barge market was a promising one at the start of 2014. Kirby, the leading operator in the field, announced it would add 29 barges to its inland fleet by the end of 2014, and Kirby CEO David Grzebinski said as late as July of that year that the waterborne transportation markets had “strong fundamentals,” and a “good long-term outlook,” with inland contract pricing on the rise. But the rapid crude price decline has caused long-term inland crude-by-barge contract prices to stall and renewals to wane. A second price dive earlier this year pummeled market confidence in an early-2016 crude recovery and sent the contracts into a slide. On top of all that, barged crude volumes have faced deep cuts since their 2013 peak after a slew of pipeline projects eased midstream congestion. The rise of inland barge shipping mirrored that of crude by rail, as the same factors … continue reading
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Source: CTRM Center